Pakistan expects growth to surge to 7% after China investments

ISLAMABAD: Pakistan is expecting its growth to rise up to 7 percent in two years in the wake of heavy investment of more than $ 40 billion by China and other partners in infrastructure development projects, reports the Bloomberg.

According to a top official of the Finance Ministry, Prime Minister Nawaz Sharif is targeting growth of 5 percent for the current fiscal year ending in June, as he works with the IMF to turn around an economy hindered by energy shortages and terrorism.

China’s plans to invest $46 billion in an economic corridor are fueling optimism that growth is set to reach new heights.

Finance Secretary Waqar Masood Khan said in an interview that PM Sharif’s government is showing investors he’s serious about implementing economic reforms by heading toward completion of an International Monetary Fund loan program.

History of Pakistan taking IMF loans dates back to 1950s and the country has struggled to see them through. It came close under former military president Pervez Musharraf, who didn’t take the last installment of that loan.

Khan said completing an IMF loan program “is always very tough.” He declined to say whether the government would seek to borrow more from the IMF in the future.

“We will cross the bridge, when we come to it,” he said.

Khan doesn’t see hurdles in selling a stake in national carrier Pakistan International Airlines Corp., a condition for the release of IMF loan installments. Protests by the national carrier’s employees last month halted its flight operations.

“It is evident that there is more interaction required between the stakeholders,” he said. “The government’s commitment to bring strategic partner in PIA and other power companies is there and would be accomplished through a consultative process.”